06. Directors: appointment, power, authority. Flashcards
s. 250 of CA (1986): The term ‘…’ includes any person occupying the position of …, by whatever name called.
director
The minimum age for a director is usually ….
16 years
T/F: the maximum age for a director is the later of 75 years or normal pension age.
FALSE
there is no upper age limit.
The directors of public companies should be voted on …
individually
Anyone who acts as a director, although not validly appointed as one.
de facto director
Anyone “in accordance with whose directions or instructions the directors are accustomed to act.”
shadow director
T/F: accountants, solicitors, bankers e.t.c. are not usually deemed to be shadow directors.
TRUE
A person sent to board meetings by a director to represent them and vote on their behalf.
shadow director
T/F: the articles of association of a company may place further limitations on who may serve as a director.
TRUE
T/F: a directors actions are valid even if their appointment is subsequently found to have been defective or void.
TRUE
Any change in directors should be notified to the registrar within …
14 days
A director may be removed by members via …
an ordinary resolution with special notice of 28 days.
T/F: any provisions in a director’s service contract regarding payments for loss of office are void if members vote to remove the director.
FALSE
the dismissed director may claim damages under their contract of service.
T/F: a director who is also a member may not vote on a resolution for their removal.
FALSE
see Bushell v Faith (1970)
T/F: weighted voting rights cannot be provided for in order to make it impossible for a director to be removed.
FALSE
see Bushell v Faith (1970)
Disqualification of a director may be general or specific by … respectively.
the courts or the articles
The powers of directors are defined by …
the articles (constitution)
T/F: the powers of directors are given by members to the board as a whole.
TRUE
not individual directors
T/F: the board of directors can only exercise its powers through formal board meetings.
FALSE
it is considered sufficient if the directors are in communication with each other
T/F: a board meeting can not be held if any director objects.
TRUE
Whether or not the actions of one person bind another into a contract with a third party is dependent on whether they have …
authority.
T/F: the company can rely upon provisions in its articles in order to avoid a contract entered into by a director without authority.
FALSE
provided that the thrid party is acting in good faith (which is presumed).
s.40 CA (2006)
T/F: a person acting as a director or managing director despite not being appointed can nevertheless be deemed to have the authority to bind the company into contracts.
TRUE
